Alibaba Group, a prominent Chinese corporation, is set to withdraw from Eternal, an Indian venture, as per CNBC-Awaaz's latest reporting, through a block deal transaction.
In a significant move, China's Alibaba Group is exiting its investment in India's Eternal, a parent company of prominent food delivery and quick commerce businesses Zomato and Blinkit. The exit comes through a block deal valued at approximately 53.75 billion Indian rupees (around $613 million).
According to reports, Alibaba’s unit, Antfin Singapore, which held a 2.08% stake in Eternal as of June, is selling its entire stake at a floor price of 285 rupees per share. This sale represents a 4.6% discount to Eternal's closing price before the sale.
The block deal is being managed by Morgan Stanley India and BofA Securities India, and the sell-off is described as a "clean out trade," marking a complete exit of Antfin from Eternal's equity.
This move is part of Alibaba’s continued exit strategy from Indian investments, following a recent sale of its stake in Paytm at a loss. However, official statements regarding the reasons behind this exit have not been released yet. The discount pricing suggests a market-driven sale for liquidity rather than a premium exit.
Eternal, with its subsidiaries Zomato and Blinkit, has been a significant player in India’s food delivery and quick commerce sectors. The sale of Antfin Singapore's stake in Eternal could have potential implications for these businesses, but further details are yet to be disclosed.
It's important to note that this exit does not seem to be related to the partnership between Alibaba Group and Pakistan, which is aimed at boosting exports. The specific details or nature of this partnership were not disclosed in the article.
The news was first reported by CNBC-Awaaz on Wednesday. Antfin and Eternal, entities associated with Alibaba Group, did not respond to Reuters' requests for comment regarding the potential deal.
In summary:
- Alibaba's Antfin Singapore is fully divesting its 2.08% stake in Eternal through a block deal of about ₹53.75 billion (~$613 million).
- The stake sale price was ₹285 per share, a discount to market price.
- Eternal owns Zomato and Blinkit, major players in India’s food delivery and quick commerce sectors.
- This continues Alibaba’s broader pullback from Indian investments, with recent exits from Paytm as well.
- No formal reason has been stated, but is likely strategic repositioning amid regulatory/business challenges in India.
The sale of Antfin Singapore's stake in Eternal, the parent company of Zomato and Blinkit, has significant implications for the food delivery and quick commerce sectors in India's business environment, as it indicates Alibaba Group's continued exit strategy from Indian investments in the finance industry. The block deal, managed by Morgan Stanley India and BofA Securities India, was valued at approximately 53.75 billion Indian rupees and was priced at a discount to the market price, suggesting a market-driven sale for liquidity rather than a premium exit.
